The strongest segment of the retailing market measured by ICSC continued to be luxury goods, the reigning retail champ for some time now. Luxury comp-store sales in January grew 8.6% compared with a year ago. Discounters came in with a respectable 4.4% comp-store increase, but the market segment catering to teens, a notoriously fickle group, posted a more modest 2.3% increase over January 2004.
"Consumers came out redeeming their gift cards and taking advantage of clearance sales, giving retailers a better than expected sales month," said Micheal Niemira, chief economist and director of research for the association. "Despite the fact that January is typically a clearance month, consumers are still in a positive spending mood." For February, ICSC expects same-store sales to increase by 3% compared with 2004.
As usual, individual retailers in the ICSC survey were all over the map when it came to January comps. Emblematic of good times in the upscale parts of the market, Neiman-Marcus scored an increase of 12.2% in January and Nordstrom turned in an 8.8% increase. At the discount end of the spectrum, behemoth Wal-Mart did well enough (up 3.2% over last January), but Target did better: up 9.4% for the month.
Department store comps for the month were more anemic, symptomatic of that segment's chronic problems. JC Penney turned in a respectable 3.3% increase for January, and so did Dillard's at +3%, while the still-independent Sears was barely in positive territory at +0.8% for the month. May, which may be bought by Federated, plunged 7.2% in January comps, and Federated itself dropped 0.4% for the month.
In a separate survey, the National Retail Federation reports that retail executives are looking to 2005 with caution. According to the results of the January NRF retail executive opinion survey, the retail sector performance index (RSPI) for January posted a normal reading of 50.3, 1.6 points lower than the prior month and 14.8 points lower than the same period one year ago—though nowhere near the 31.7 reading from 2003. The RSPI measures retail executives' evaluations of monthly sales, customer traffic, average transaction per customer, employment, inventories and a six-month-ahead sales outlook expectation. It's on a scale of of zero to 100, with 50 equaling normal.
"Retailers are aware of the challenges they face in 2005," says federation president and CEO Tracy Mullin. "With consumers under increased financial pressure due to higher energy costs and slower wage growth, it will be more difficult to match comparable sales growth from the previous year."
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